New Delhi, May 31 (KNN) Union Minister of State for Micro, Small and Medium Enterprises and Labour and Employment Shobha Karandlaje criticised banks for imposing excessive bureaucratic hurdles on micro, small and medium enterprises seeking loans during the India MSME Conclave 2025 held on Friday.
The minister emphasised that financial institutions are causing significant difficulties for MSMEs through cumbersome paperwork requirements and restrictive lending practices.
Deputy Chief Minister DK Shivakumar joined Karandlaje in urging banks to adopt more liberal approaches toward MSME financing.
Shivakumar confirmed the Karnataka government’s commitment to establishing a dedicated department for small and medium enterprises, fulfilling a promise made by Chief Minister Siddaramaiah earlier this month.
MG Balakrishna, President, India MSME Conclave 2025, noted that the state government has granted in-principle approval for appointing an exclusive secretary for MSMEs.
The Deputy Chief Minister outlined ambitious infrastructure development plans, announcing the government’s proposal to invest Rs 1 lakh crore in Bengaluru’s development over the next four to five years.
Shivakumar highlighted India’s competitive labor cost advantages, stating that labor costs in the United States are ten times higher than in India, while Chinese labor costs are four times more expensive.
He stressed the importance of reducing India’s dependency on foreign nations and leveraging the country’s skilled workforce as a strategic advantage.
Prime Minister Narendra Modi, in his written address to the conclave, reinforced the central role of MSMEs in India’s economic growth trajectory.
Modi stated that as India progresses toward achieving the vision of Viksit Bharat by 2047, MSMEs will remain fundamental to the nation’s development story.
The Federation of Karnataka Chambers of Commerce and Industry has long advocated for reforms in MSME governance, including the establishment of a dedicated departmental structure.
The organisation has presented additional recommendations encompassing minimum wage reductions, development of an exclusive MSME policy, rationalisation of operational costs including power tariffs and property taxes, and appointment of specialised land acquisition officers to facilitate land allocation through the Karnataka State Small Industries Development Corporation.
The Karnataka Small Scale Industries Association has similarly pressed for addressing persistent challenges facing MSMEs, particularly in areas of market access, capability development, regulatory compliance, and policy awareness.
These organisations have emphasised the need for comprehensive systemic reforms to support MSME growth and sustainability.
Industry participants across various conclave sessions encouraged government ministries to establish standardised procedures while calling on banking institutions to streamline their processes.
MSME representatives also raised concerns about restrictive tender allocation requirements, specifically citing minimum export experience criteria of five to seven years that limit opportunities for emerging businesses in the sector.
(KNN Bureau)
